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Competition grips real estate market

The real estate crisis has eliminated weak investors, increased competitiveness and brought more choice for clients.Unlike in the past, where buyers would buy on spec, buyers can now expect completed building work, as well as the proper legal documentation. Now, land purchase and transfers are handled by experienced financial investors, especially for projects that have reached a standstill.

The 557 investment joint-stock company is to buy an apartment project in district 9, HCM City that has been at standstill for the past five years.

"Many investors have mortgaged their land-right certificates to borrow money for construction. But most of them have not been able to finish the project as their funds ran out.

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the project, they can't sell it as it has not been completed, and all the while they must still pay interest," Than Qui Phai, general director of the 557 investment joint stock company told the Sai Gon Giai Phong (Liberated Sai Gon) newspaper.

The HCM City Infrastructure Investment Joint stock company (CII) will also buy shares of several partners in different real estate projects this year to help move the projects forward.

"When a project faces financial difficulties, the investors must transfer or co-operate with other companies or else eliminate themselves from the market," Le Quoc Binh, general director of the (CII) said.

"The market needs more and more buoyant companies with good, solid projects," said Le Chi Hieu, chairman of the Thu Duc House's management board.

The Sai Gon Thuong Tin Real Estate company (Sacomreal) has recently announced that they are to sell the Arista Vills residential projects in Thu Duc district. All infrastructure, such as the swimming pool, tennis court and children's playground has now been completed. Clients only need to pay 20 per cent of value of the property and can pay the rest over the next 24 months.


  "In the context of the frozen real estate market, we must convince our customers. We must prepare all the necessary infrastructure and encourage them to build houses immediately after buying land," Bui Tien Thang,

general director of the Sacomreal said.

An entertainment area with children's play battleground, swimming pool, rowing facilities, and restaurants has been built in the BCR project, invested in by House Viet Nam Joint Stock company to lure buyers.

For Tan

district's Au Co Tower, the investors have started granting apartment certification for all customers despite the fact that they haven't sold all apartments.

The Tac Dat Tac Vang company has invested in projects in new Binh Duong City. A night market was built by the company to make it more convenient for local residents.

Completed projects with good local conveniences,

sales policies and granted legal certificates will attract customers, a representative of HCM City's Real Estate Association said.

Incentives help spur on domestic real estate market

The real estate inventory is finally decreasing, albeit slowly, said an official of the Ministry of Construction.

In the first nine months of this year, real estate inventory across the country reached VND101.9 trillion (US$4.8 billion), VND12.6 trillion lower than the value in the first quarter.

The reduction was due to more local real estate transactions, according to the ministry.

Investors nationwide focused on promoting apartments and houses to potential buyers.

Many commercial projects were converted to social housing so investors could take advantage of a VND30 trillion ($1.4 billion) preferential credit package. Almost all the dwellings sold were small, affordably priced apartments.

Many enterprises, especially in the south, cut prices by restructuring plans to push down production costs.

Minister of Construction Trinh Dinh Dung said the value was calculated from completed property products, although projects currently in the site clearance and construction stages also had high
Binh Duong real estate services

The important thing was to square the oversupply of luxury property with the lack of affordable apartments, he said.

The ministry instructed provinces and cities to create favourable conditions for enterprises and investors to convert commercial projects to social projects as demand required.

Economist Tran Du Lich agreed the supply of low-income housing for workers should be increased, but argued the State should use the VND30 trillion package to support buyers rather than sellers.

Property expert Dang Hung Vo said many changes were needed to spur a real estate recovery, including new State policies, heightened efforts by investors and the renewed confidence of consumers.

If consumers had confidence in the market, they would invest 400 tonnes of their gold inventory in the local property market, Vo said.

Nationwide, VND4.48 trillion has been invested in 4,015 housing projects, according to the construction ministry. Of the total registered investment, VND774.7 billion (17.26 per cent) has been disbursed.

Medium- and low-cost houses top picks on property market

Property companies said the demand for medium- and low-cost houses were very strong, expecting the market will recover in the last six months of the year.

Chairman Le Hoang Chau of the Ho Chi Minh City Property Association said “I believe the property market this year will recover and grow strongly.”

“The government determined to fight against inflation, tightening the monetary policy. The move, in short term, may make some impacts to the market, but later it will help the market to develop more steadily.”

Chau noticed that administration procedures for property investments were gradually getting simple, encouraging investors to make more investments.

“That is signals of a strong recovery on the market this year, especially at yearend. I expect houses and apartments with medium and low cost will be the top picks,” he said.

Orders of customers for medium-cost houses this year made out of 40%, Le Chi Hieu, chairman and general director of listed property house ThuDuc House said, expecting investors will focus on this segment.

Analysts said a fast urbanization process and large waves of immigrations from rural areas to big cities including Hanoi and HCM City boosted the housing demand in the next 20 years, making the property market pretty promising.

However, investors are coping with many challenges including high interest rates as